SAP SE: A Leading Player in AI-Driven ERP Solutions

SAP SE (NYSE: SAP) is prominently featured on the list of AI Stocks Every Investor Should Watch.

On September 22, BofA Securities analyst Frederic Boulan adjusted the price target for SAP stock, setting it at EUR 316.00, down from EUR 320.00, while sustaining a Buy rating.

Despite the stock underperforming the SX8P index by 5 percentage points since the Q2 earnings report in July, BofA continues to highlight SAP as a top pick among large-cap stocks, asserting that its long-term growth trajectory remains both structural and resilient.

This robust growth is largely attributed to ongoing software upgrades and infrastructure migration cycles. Additionally, SAP is seen as a prime beneficiary in the artificial intelligence sector due to its vast data ownership, which presents significant monetization opportunities through an extensive range of AI products including SAP Joule and Analytics agents.

“We reiterate our Buy rating and large-cap top pick on SAP. The stock is one of our ’25 stocks for 2025′ and is featured on our Europe 1 list of top ideas. Shares have underperformed the SX8P by 5pp since Q2 earnings in July, and messages from recent back-to-school conferences reflect a cautious stance on short-term bookings. However, we see the growth of SAP as structural, buoyed by ongoing software upgrades and infrastructure migration cycles. Furthermore, we recognize SAP as an essential player in the AI space, supported by critical data ownership, which offers monetization upside through a comprehensive AI product suite, including SAP Joule and Analytics agents. We also anticipate AI will promote operational efficiencies, targeting approximately €0.5 billion in AI-driven improvements and up to 30% efficiency gains in R&D. We project a solid path for revenue acceleration post-2026. Thus, we are revising forecasts for foreign exchange impact (approximately 50 basis points on 2025 revenue, 100 basis points in 2026) and adjusting the price objective to €316 from €320 (ADR down to $371 from $376). We maintain a Buy rating at a valuation of 20 times the projected 2026 EBITDA for a growth trajectory that remains highly predictable.”

SAP SE (NYSE:SAP) continues to hold a dominant position in the ERP software landscape, leveraging artificial intelligence to refine and enhance its enterprise resource planning solutions.

While we recognize SAP’s potential as a solid investment, it is essential to consider that some other AI stocks may present greater upside potential alongside reduced downside risks. For investors seeking deeply undervalued AI stocks poised to benefit from onshoring trends and Trump-era tariffs, we encourage you to check out our report on the best short-term AI stock.

Related Articles: 10 AI Stocks on Market Radar and 10 AI Stocks in the Spotlight This Week

Disclosure: None.